On the Mechanics of Measuring the Production of Financial Institutions

With the emergence of new technologies, innovative financial instruments and the integration of global market operations national accountants are confronted with a series of new challenges and complexities in determining the output of financial institutions. The SNA93 recommended measure, the FISIM – financial intermediation services indirectly measured - which focused around the traditional deposits and loans business is currently under scrutiny as numerous views have been expressed questioning its validity in measuring the financial output. Critics have argued that the FISIM, as is defined, fails to capture the recent developments in financial markets and the technological advances and thus undermine the true economic contribution of these institutions. Several OECD task groups have examined this issue and currently considering changes to the existing methodologies. The goal of this study is two-fold. First, it explores a number of emerging areas in finance that are critically important for national accounting purposes. Second, by using the latest I-O tables the paper examines empirically how the recent technological advances and the global market environment have impacted the Canadian financial sector and provides some insights as to how the current SNA practices could be extended to account for such changes. *FISIM, Financial Economics

Exchange rate exposure of stock returns at firm level

The use of conventional augmented CAPM specification in estimating the exchange rate exposure may result in less reliable estimates for, at least, two reasons. First, it does not take into account a few important stylized facts associated with financial time series. Second, one cannot estimate the total impact of the exchange rate changes on stock returns as a single coefficient with it and for this reason it does not help us analyze the reinforcing or offsetting interactions between direct and indirect exchange rate exposure effects. In this paper, we suggest an orthogonalized GJR-GARCH-t version of augmented CAPM that simultaneously addresses the above issues. Our findings have important implications for hedging and investment decision making.Exchange rate exposure, GARCH, t distribution, Asymmetric volatility

Flow behaviour of dielectric liquids in an electric field

A family of 10 silicone oils with electrical conductivity similar to 10(-13) S m(-1) (a regime hitherto systematically unexplored) and viscosities ranging from 1 to 2000mPas have been Subjected to an electrical field of up to 1.5kV mm(-1) during flow from a needle. The flow behaviour of these liquids is investigated experimentally in the flow rate regime 10(-8)-10(-12) m(3) s(-1) and we analyse the results using the Ohnesorge number. Due to the low electrical conductivity and high electrical relaxation time of the silicone oils, only unsteady transient jets were found. The onset of this type of jetting has been defined using current measurements and, in contrast to conducting liquids, the non-dimensional jet diameter increases with increase in Ohnesorge number. The time elapsed between the start and finish of jetting increases with increasing Ohnesorge number

Time-Varying Currency Betas: Evidence from Developed and Emerging Markets

This paper examines the conditional time-varying currency betas from five developed markets and four emerging markets. A trivariate BEKK-GARCH-in-mean model is used to estimate the timevarying conditional variance and covariance of returns of stock index, the world market portfolio and changes in bilateral exchange rate between the US dollar and the local currency of each country. It is found that currency betas are more volatile than those of the world market betas. Currency betas in emerging markets are more volatile than those in developed markets. Moreover, we find evidence of long-memory in currency betas. The usefulness of time-varying currency betas are illustrated by two applications.time-varying currency betas; multivariate GARCH-M models; international CAPM; fractionally integrated processes; stochastic dominance

Exchange Rate Exposure of Sectoral Returns and Volatilities: Evidence from Japanese Industrial Sectors

Most studies of exchange rate exposure of stock returns do not address three relevant aspects simultaneously. They are, namely: sensitivity of stock returns to exchange rate changes; sensitivity of volatility of stock returns to volatility of changes in foreign exchange market; and the correlation between volatilities of stock returns and exchange rate changes. In this paper, we employ a bivariate GJR-GARCH model to examine all such aspects of exchange rate exposure of sectoral indexes in Japanese industries. Based on a sample data of fourteen sectors, we find significant evidence of exposed returns and its asymmetric conditional volatility of exchange rate exposure. In addition, returns in many sectors are correlated with those of exchange rate changes. We also find support for the “averaged-out exposure and asymmetries” argument. Our findings have direct implications for practitioners in formulating investment decisions and currency hedging strategies.exchange rate exposure; asymmetric volatility spillovers; GARCH-type models; conditional correlation

Assessing Factor Contribution to Nitrogen Concentration Levels in the Raccoon River Watershed in Iowa

Environmental Economics and Policy,

Comparing reporting of MYOB Enterprise Reporter vs Xero HQ Reporter

ABC Chartered Accountants is a public accounting practice located in Te Awamutu, providing professional accounting services to a range of clients. MYOB Enterprise (MYOB AE) is used as office accounting software, and financial statements are produced by MYOB AE reporter. This research compares reporting of the existing MYOB AE reporter with Xero HQ reporter, as an alternative for compliance, efficiency, consistency, and report customizing process, and also to find out any other additional reports that Xero HQ can produce compared to MYOB AE. Semi-structured interviews were used to investigate the insight of MYOB AE reporter and Xero HQ reporter. Actual MYOB AE software, together with some MYOB supporting materials, were used (MYOB. Reporter 3.3.help Designing & Generating reports for your practice .Reporter 3.2) and Xero reporting videos (Xero Partner Resources. 2018), with some Xero reporting information published from Xero (www Xero.com/report template in action) were used. The major findings are that MYOB AE and Xero HQ offer compliance reporting templates for different types of entities. Both software allow customised reports to reflect practice preferences. Customising reports help to keep report consistency and report efficiency at the practice. When customising reports in MYOB AE, formats are created, and in Xero HQ Rich Text Editor, Layout Editor and Report Setting Editor are used. When customizing reports, the time spend on planning a new report will maximize the benefit to the practice. So, the difference between the two reporters is the method of customizing reports

VOLUNTARY ACTION OF A FIRM ON ENVIROMENT MANAGEMENT: AN EMPIRICAL ASSESSMENT ON SRI LANKAN FOOD PROCESSING FIRMS’ RESPONSE TO THE PRIVATE AND REGULATORY INCENTIVES

The effect of a set of private/market (i.e. financial implications, internal efficiency, market response) and public/non-market (i.e. government regulation, judiciary/legal system) incentives for a firm to act voluntarily on environmental quality is examined. It uses the levels of adoption of five solid waste management practices [SWMPs], namely: (1) 3R system; (2) Composting; (3) Good manufacturing practices; (4) Biogas unit, and (5) ISO 14000 by food processing sector in Sri Lanka in response to the prevalence of each incentive at the firm as the case. The data collected from 325 firms through in-depth interviews and site inspections and supported by a validated structured questionnaire were analyzed using the principles of Structural Equation Modeling. The “Analysis of Moment Structures” (AMOS) software was used to establish the relationships between the levels of adoption of SWMPs and the strength of each incentive. The results show that firms‟ response to environment is relatively low, i.e. 49.2% did not adopt a single practice, while only 28%, 12%, 7.4%, 3.1% and 0.3%, respectively, have adopted 1, 2, 3, 4 or all practices. Firms tend to adopt a higher number of SWMPs as the relative strength of an each incentive perceived by the decision maker of firm gets increases. Firms put a higher weight on the impact on regulation and legal system than the private incentives and the firm size has a substantial impact on its response to the environment. The results highlight the importance of bringing the current public regulatory regimes in developing countries like Sri Lanka towards co-regulation, which is practiced by developed countries like Australia and Canada to facilitate businesses to come up with own solutions for environmental and food quality, as the outcome of this analysis points out that firms‟ compliance to the recommended SWMP was not triggered satisfactorily by the private/voluntary action.Environment management, Food processing sector in Sri Lanka, Incentives, Regulation, Solid waste management, Voluntary adoption, Farm Management,